I can definitely see the need to improve overall web browser and underlying platform security, and extending this security to the web browser, its plugins and the underlying native platform. From the paper's conclusion:

"We have presented Gazelle, the first web browser that qualifies as a multi-principal OS for web site principals. This is because Gazelle’s Browser Kernel exclusively manages resource protection, unlike all existing browsers which allow cross-principal protection logic to reside in the principal space. Gazelle enjoys the security and robustness benefit of a multi-principal OS: a compromise or failure of one principal leaves other principals and the Browser Kernel intact.

Our browser construction exposes challenging design issues that were not seen in previous work, such as providing legacy protection to cross-origin script source and cross-principal, cross-process display and event protection. We are the first to provide comprehensive solutions to them.

The implementation and evaluation of our IE-based prototype shows promise of a practical multiprincipal OS-based browser in the real world. In our future work, we are exploring the fair sharing of resources among web site principals in our Browser Kernel."

Also, since Microsoft has come under criticism from some investors for still re-investing revenue in R&D in a very tight ecconomy, I wonder if this effort and publicity, even with its tremendous value, is an effort by the company to backup its approach to its business?